Alkaline phosphatase levels in non-transformed cells were compared with those of cells transformed by Rous sarcoma virus. The non- transformed cells have levels of enzyme activity several fold more than transformed cells. The results suggest that this decrease may be a general property of transformed cells and possibly can be used as a biochemical marker to distinguish them from their normal counterparts. Electron microscopy and cytochemical methods are being utilized to further characterize vacoulization occurring in CE cells after infection with Rous sarcoma virus. Experiments are now in progress to determine origin and development of vacuoles occurring in cells transformed by the Bryan "high titer" strain of Rous sarcoma.